China is Showing Explosive Growth in Patent Application Filings

The United Nations’ intellectual property agency says China is showing “extraordinary” growth in international patent applications, putting Chinese applicants on track to outpace their U.S. counterparts within two to three years. Francis Gurry, director-general of the World Intellectual Property Organization (“WIPO”), says China posted nearly 45-percent growth in such patent applications last year, saying “the country continues its journey from ‘Made in China’ to ‘Created in China.'”

Overall, the United States was first for the 39th straight year and accounted for nearly 56,600 applications under the Patent Cooperation Treaty, followed by Japan at over 45,200 and China at nearly 43,200. China’s state-owned ZTE Corporation in Shenzhen, one of the world’s biggest suppliers of network switching gear, was the No. 1 applicant last year, topping crosstown rival Huawei. U.S.-based Qualcomm was third.

Patent law, a form of intellectual property law, is designed to encourage inventors to disclose their innovations in technology for the purpose of promoting the common good by offering the incentive of a limited-time monopoly on such technology. A patent grants its holder the exclusive right to prohibit others from making, using, importing, and selling the patented innovation for a limited period of time.

WIPO’s findings come on the heels of a November 2016 report from the agency after China became the first country to file 1 million patent applications in a single year. Gurry said at the time that the bulk of China’s 1.01 million applications were for domestic protection in patents, trademarks and industrial design, with only some 42,154 filed abroad.

Such innovation in China in terms of patentable inventions is particularly interesting given the country’s seemingly unending production of counterfeit goods. In a U.S. Customs raid at the Port of Tacoma in Washington State, U.S. Customs and Border Protection in the past week seized an ocean cargo container of 2,100 LCD televisions from China with counterfeit trademarks and four containers of ceiling fans with improper safety labels. Moreover, a shipment of 950 microphones and cables was also seized because the merchandise was labeled as being made and “Manufactured in the U.S.A.,” but the boxes they came in said made in China.

The recent bust represents just one of a truly significant trade issue; last year, 83 percent of Homeland Security’s counterfeit seizures originated in mainland China or Hong Kong.